Research has revealed that the majority of over 55s wish to retain some control over how any money they leave to their offspring is spent.
The recent growth in pension wealth and obstacles to accessing the property ladder mean that a large portion of the older generation will bequeath large sums to children and grandchildren. However, 77% of those aged 55 or over expressed that they’d like an element of control over how this inheritance is used.
In order to ensure any money from their estate is spent wisely, 12% of parents want to specifically set out how it can be spent, whilst 13% are intending to or have already sought financial advice. A tenth of respondents stated that they will instruct their children to this once the inheritance is passed on.
Whilst inheritance is likely to play a large part in financing future generations, many of the over 55s are wary of what could happen to their legacy after their death. Over a quarter of parent respondents stated that they were concerned about their money going to the spouse of a child should they get divorced. Just under a third (30%) stated that they wanted to make sure that their grandchildren would benefit from their inheritance, with the same number stating that they didn’t want their children to be frivolous with any wealth they received.
Commenting on the research was Les Cameron. The tax expert at Prudential highlighted the current state of the economy, and how it’s led to people having a greater desire to hold on to familial wealth.
“With two in five marriages ending in divorce, it is easy to understand why the problem of keeping wealth within their family is a growing concern for the bank of mum and dad when they’re planning to leave money to children and grandchildren.
“To help ensure efficient inheritance tax planning, obtaining financial and legal advice should be money well spent.”
